Inca Pacific Resources Inc.

Inca Pacific Resources Inc.
Quadra Mining Ltd.

Quadra Mining Ltd.

March 04, 2005 08:30 ET

Quadra and Inca Pacific Sign Agreement for the Development of Magistral






MARCH 4, 2005 - 08:30 ET

Quadra and Inca Pacific Sign Agreement for the
Development of Magistral

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 4, 2005) - Quadra
Mining Ltd. (TSX:QUA) ("Quadra") and Inca Pacific Resources Inc. (TSX
VENTURE:IPR) ("Inca") are pleased to report that a definitive agreement
has been reached for the development of the Magistral copper-molybdenum
project in Peru in respect of the Letter of Intent, announced on January
12, 2005. Under the terms of the agreement, Quadra can earn a 50.1%
interest in Ancash Cobre S.A., the 100% owner of the Magistral project,
by completing a bankable feasibility study for a minimum 15,000 tonnes
per day operation by 30th November, 2006. Quadra can increase its
ownership from 50.1% to 65% by arranging project financing on or before
30th June 2007. Once Quadra has met its obligations with respect to the
feasibility study and financing, and has reached 65% ownership, each
party will be responsible for its share of the project development costs.

The definitive agreement provides for a closing of the initial stage of
the transaction at which point US$1 million in shares of Quadra, US$1
million in cash and a further CDN$1 million in cash in exchange for one
million common shares of Inca will be paid to Inca by Quadra. The Inca
shares held by Quadra will be subject to a voting trust. The closing is
subject to regulatory approval and certain other conditions for the
benefit of each party. It is currently anticipated that the closing will
occur on March 10, 2005.

Further consideration will be paid as follows:

1. US$1 million in shares of Quadra and US$1 million in cash upon
completion of a positive pre-feasibility study.

2. US$1 million in shares of Quadra and US$1 million in cash upon
completion of a positive "bankable" feasibility study.

3. US$2 million in cash upon completion of project financing.

Quadra may withdraw from the agreement before 1st October 2005, provided
that it has completed certain work obligations. After this date, Quadra
is obliged to produce a pre-feasibility study on or before 28th February
2006. If this study is positive and Quadra elects to go forward, it is
then obliged to produce a bankable feasibility study on or before 30th
November 2006. Once Quadra has arranged financing to put Magistral into
production, Inca is entitled to sell its remaining 35% interest to
Quadra at a price to be determined at that point in time based on the
net present value of the project. Payment may be made, at Quadra's
option, in shares or cash. At Inca's option Quadra will provide
guarantees for Inca's portion of any debt required to finance the
project and in return Inca shall pay Quadra a guarantee fee of 4% per
annum of the amount of debt attributable to Inca, until such time as the
debt becomes non-recourse to Quadra.

Magistral is a late stage development project in Peru with scoping
studies covering all the key issues. As previously disclosed in Inca
Pacific's news release dated January 5, 2005 in respect of which a
technical report was filed February 1, 2005, Measured and Indicated
Resources were 76 Million Tonnes at 0.76% Cu and 0.055% Mo and Inferred
Resources were 39 Million Tonnes at 0.71% Cu and 0.039% Mo using a 0.5%
Cu cut off.

Anthony Floyd, President of Inca Pacific, said, "Magistral is now in the
hands of an operator who has the managerial and financial capacity to
make it into a mine. We look forward to working with Quadra going
forward as they build on the drill database and studies that Inca has
completed and move towards production."

Paul Blythe, President of Quadra Mining, said "We are pleased to have
reached an agreement with Inca and to be able to participate in the
Magistral project. We were very encouraged by what we saw on site during
our due diligence visit. We intend to begin work immediately on a number
of fronts including infill drilling, metallurgical testing,
environmental studies, community relations and development of
infrastructure strategies. We see Magistral as an excellent fit for our
strategic plan as it represents a late stage development project that is
of a size we can handle comfortably and that has the potential to become
a good business for Quadra and Inca shareholders."


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